COMMODITIES-Oil, gold dip on Bernanke stimulus remarks, grains up

June 19, 2013|Reuters

By Barani Krishnan NEW YORK, June 19 (Reuters) - Oil prices came under pressureon Wednesday while gold and copper fell after Federal ReserveChairman Ben Bernanke said the central bank could begin to scaleback its stimulus measures for the U.S. economy later this year. Agricultural markets rose broadly. Wheat had its biggestrally since April on bargain buying and expectations the grainwill be used as a livestock feed. The rally in farm futures helped the 19-commodity ThomsonReuters-Jefferies CRB index close up 0.5 percent forits biggest gain since June 3, after being subdued the past twoweeks on uncertainties over what the Fed might do. Bernanke told a news conference after a two-day Fed meetingthat the central bank expects to slow the pace of its bondpurchases later this year and bring them to a halt aroundmid-2014. Oil prices closed little changed at the end of Wednesday'sofficial session and fell after-hours as the market digestedBernanke's remarks. The Fed's stimulus has been responsible for many of thehighs in commodity prices since the financial crisis, with thecentral bank committed to buying $85 billion of bonds a monthunder its third and latest quantitative easing plan.

Benchmark Brent crude oil out of Europe's North Sea finished up 10 cents a barrel at $106.12. Prices turned lower inpost-settlement trading, hitting a low of $105.55. In New York, the front-month contract for U.S. crude finished down 20 cents at $98.24 per barrel and slipped below$98 after the close. Aside from the news on the Fed, oil was weakened by datashowing U.S. crude stocks rose by 313,000 barrels last weekagainst market forecasts of a 500,000 barrel decline. The spot price of gold was down 0.5 percent at around$1,360.60 an ounce by 3:10 p.m. U.S. gold futures for August settled up $7.10 at$1,374 an ounce, with volume at around 113,000 lots versus its30-day daily average of 212,000, Reuters data showed. Copper fell to a six-week low, finishing down for a thirdstraight day. Three-month copper on the London Metal Exchange slid 1.1 percent to a session low of $6,925 a tonne,its weakest since May 3. Grain markets rose across the board, with wheat the biggestmover. Wheat's front-month July contract on the ChicagoBoard of Trade ended up 19-1/2 cents, or nearly 3 percent, at$7.07 per bushel.